What to Do About Consumer Contracts That Stifle Online Free Speech?

Some companies are trying to keep ahead of negative online reviews by suing or threatening consumers.

That’s the claim of Connecticut Senator Richard Blumenthal, who said legislation is needed to ensure free speech online.

A bill Blumenthal is sponsoring would make it illegal to put language into contracts that binds consumers to what are called "non-disparagement" clauses. Those currently give companies an opening to penalize customers who write unflattering reviews.

"These online reviews essentially provide vital information," Blumenthal told a news conference in Hartford. "And very regrettably, some retailers are discouraging -- in fact, they are threatening and bullying consumers to stop those online reviews. They're seeking to censor, scrub, and sanitize the reviews."

Blumenthal cited the case of a New York hotel, which threatened to penalize newlyweds $500 for every negative review posted by anyone attending their wedding.

The effort to safeguard negative reviews is backed by Consumers Union, which produces the magazine Consumer Reports. Programs Director Chuck Bell said consumers have been fined, reported to credit agencies and even taken to court by companies they criticized.

"We are seeing more of these clauses buried in the fine print of consumer contracts, from everything from electronics to hotels to weight loss products," said Bell. "Honest, independent reviews are core to our mission and to the information that we research and publish."

Bell said many people are unknowingly signing away their rights to speak out about products or services they've bought.

"Consumers sign all kinds of agreements in the course of renting a car, visiting a hotel, buying products, and typically you don't realize you've signed this type of a clause until after the fact," Bell said.

Blumenthal emphasized that the legislation would still allow companies to take action in the case of slander or defamation in a review.

Separate bills in the House and Senate both attempt to address the issue by outlawing gag clauses in consumer contracts, and Blumenthal said the measures have broad, bipartisan support.